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EDA Agenda 04-25-2006 . ANNUAL MEETING AGENDA MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Tuesday, April 25, 2006 - 4:00 p.m. City Hall - Academy Room 1. 2. 3. 4. 5. . 6. . MEMBERS: Chair Bill Demeules, Vice Chair Barb Schwientek, Council members Wayne Mayer and Tom Perrault, Ron Hoglund, Darrin Lahr, and Susie Wojchouski. STAFF: Treasurer Rick W olfsteller, Executive Director Ollie Koropchak, Recorder Angela Schumann. Call to Order. Consideration to approve the November 29, 2005 and December 13, 2005 EDA minutes. Consideration of adding or removing agenda items. Consideration to elect 2006 EDA officers. Consideration to review and accept the year-end EDA Financial Statements, Activity Report, and proposed 2006 Budget. Consideration to review the summary year-end balances of the GMEF, MIF, UDAG, and ERG Funds. 7. Consideration to review for amendment the Business Subsidy Criteria and Bylaws of the EDA. 8. Executive Director's Report. 9. Other Business. 10. Adjournment. . . . MINUTES MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Tuesday, December 13,2005 - 4:00 p.m. City Hall - Academy Room MEMBERS PRESENT: President Bill Demeules, Vice President Barb Schwientek, Council Members Wayne Mayer and Tom Perrault, Ron Hoglund, and Darrin Lahr. MEMBER ABSENT: Susie Wojchouski. STAFF PRESENT: Treasurer Rick Wolfsteller and Executive Director Ollie Koropchak. 1. Call to Order. President Demeules called the EDA meeting to order at 4:05 p.m. 2. Consideration to aoorove the November 29. 2005 EDA minutes. Unavailable, no action. 3. Consideration of addin!! or removin!! a!!enda items. Tom Perrault asked about the application of 1.(b) on page 4 of the GMEF Guidelines and stated the federal minimum wage of$5.15 at 160% is $8.24 ph and the state minimum wage of$6.15 at 160% is $9.84 ph. If was noted the GMEF wage level criteria includes the word or. At least 90% of the jobs created must pay a wage of the higher of$9.00 per hour, or at least 160% of the federal minimum wage, exclusive of benefits, for individuals over the age of 20 during the term of the assistance. Koropchak recalled the federal minimum wage level was included to meet the requirements of the Green Acres Clause. The Federal HUD -low to moderate income levels are noted within Section V. page 7. 4. Public Hearm!! on the orooosed amendments to the Monticello EDA Business Subsidv Criteria and consideration to aoorove. Koropchak informed the EDA commissioners that the City Council adopted the resolution requesting the EDA be designated as the local development organization and approved the proposed amendments to the GMEF Guidelines on Monday, December 12, 2005. Mayor Herbst did ask if designation of the EDA as a LDO would limit the City's chances of being awarded another grant in the future. Koropchak responded "no", as Carol Pressley-Olson was excited to hear of the potential re-use of the federal dollars. The State likes to see the re-use of dollars and the first re-use is accountable to the State via a report. The State enjoys working with the City of Monticello as they know the dollars are circulated. Koropchak noted the public hearing notice appeared in the local newspaper on December 1 and 8, 2005, satisfying the notice requirement for a public hearing. A public hearing is required to amend the EDA Business Subsidy Criteria. 1 . . . EDA Minutes - 12/13/05 Perrault asked: At the proposed interest rates of 0% or up to 3% below prime rate, would the EDA lose money? The EDA requires a minimum $200 application fee and the applicant is responsible to reimburse the EDA for costs associated with preparation of the loan documents prepared by the EDA attorney. The reimbursement is collected at time of closing. Therefore, Koropchak did not foresee the EDA would lose money other then an inflation factor. President Demeules opened the public hearing. With no one present to offer public comments or questions, the public hearing was closed. Barb Schwientek made a motion to approve the proposed amendments to the Monticello EDA Business Subsidy Criteria as presented: 0% interest rate with balloon payment in three years or up to 3% below prime rate with balloon payment in five years. Applicant subject to Federal requirements including 51% of jobs must be made available to or held by LMI persons. Also requested submission of the Designated WO Council Resolution and amended Criteria to DEED for approval. Darrin Lahr seconded the motion and with no further discussion, the motion carried. Koropchak indicated a cover letter would be drafted to accompany the resolution and criteria which will be mailed to the State tomorrow requesting approval. Schwientek asked when the EDA could expect a response from the DEED. Koropchak said she did not know but would follow-up. 5. Other Business. Koropchak reiterated the written Director's report. Demeules indicated his willingness to serve another term on the EDA and Lahr indicated his willingness to serve another term on the HRA. These names will be recommended to the City Council at the first meeting in January 2006 for appointment on the respective commission. 6. Adiournment. Tom Perrault made a motion to adjourn the EDA meeting. Darrin Lahr seconded the motion and with no further business, the meeting adjourned at 4:20 p.m. Ollie Koropchak, Recorder 2 . . . EDA AGENDA - 04/25/06 4. Consideration to Elect 2006 EDA Officers. A. Reference and Backaround. In order to comply wi th EDA Ordinance Amendment No. 172, Section 2-3-2: The Authority shall annually elect a president, vice president, treasurer, assistant treasurer, and secretary. The current list of officers are: President Vice President Treasurer Assistant Treasurer Secretary Bill Demeules Barb Schwientek Rick Wolfsteller Ron Hoglund Ollie Koropchak Nominations will be made at the meeting; therefore, any EDA member unable to attend the meeting and doesn't wish to be re-elected or nominated, please contact me. NO ACTION REQUIRED, FOR INFORMATION PURPOSES ONLY In order to comply with EDA Ordinance Amendment No. 172, Section 2-3-1: Creation: (C) Thereafter the initial appointment, all commissioners shall be appointed for six-year terms, except that any person appointed to fill a vacancy occurring prior to the expiration of the term which his/her predecessor has been appointed shall be appointed only for the remainder of such term. 2006 EDA membership and 6-year term: Tom Perrault, Council Ron Hoglund Susie Wojchouski Wayne Mayer, Council Darrin Lahr Barb Schwientek Bill Demeules 12-2006 12-2007 12-2008 12-2008 12-2009 12-2010 12-2011 Page 1 . . . B. EDA AGENDA - 04/25/06 A1ternative Action: 1. Motion to nominate and elect the ....Chair......... Vice Chair. ......... ... ...... Assistant Treasurer. and......... ... 2006 EDA officers. following Treasurer. Secretary as 2. A motion to table election of 2006 EDA officers. C. Recommenda tion: No recommendation is given. D. Supportina Data: None. Page 2 . . . EDA Agenda - 04/25/06 5. Consideration to review and accept the 2005 Year-End EDA Financial Statements. Activity Report. and 2006 Proposed Budl!et. A. Reference and Backl!round: In order to comply with EDA Ordinance Amendment No. 172, Section 2-3-6: The Authority shall prepare an annual budget projecting anticipated expenses and sources of revenue. And B: The Authority shall prepare an annual report describing its activities and providing an accurate statement of its financial condition. Said report shall be submitted to the City Council in May of each year. Enclosed are the year-end statements, proposed budget, and activity report. The EDA will need to review and discuss prior to consideration of the following alternative action. B. Alternative Action: 1. A motion to accept the 2005 year-end financial statement and activity report for submission to the City Council on May 8 or 22, 2006. 2. A motion to accept the 2005 year-end financial statements and activity report subject to named revisions prior to submission to the City Council. 3. A motion to not accept the 2005 year-end financial statements and report. 4. A motion to table any action. C. Recommendation: If the EDA commissioners make a finding that the statements and report are acceptable, recommendation is alternative no. I. Due to the Finance Department not closing year-end 2005 books, this is a draft copy. All GMEF loan paybacks are current. D. Supportinl! Data: Copies of financial statements and report. I . MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY MONTICELLO GREATER MONTICELLO ENTERPRISE FUND (GMEF) Balance Sheet December 31, 2005 ASSETS Cash in Bank Accounts Receivable Notes Receivable - Tapper, Inc. I Notes Receivable - Muller Theatre Notes Receivable - SMM, Inc. Notes Receivable - Aroplax Corp.I Notes Receivable - Custom Canopy, Inc. Notes Receivable - Standard Iron Notes Receivable - Vector Tool Notes Receivable - Tapper, Inc.II Notes Receivable - SELUEMED Notes Receivable - T J Martin Ctes Receivable - Mainline Distribution tes Receivable - Aroplax Corp II Notes Receivable - TCDC Notes Receivable - IRTI Notes Receivable - GWJ,LLC Notes Receivable - VisiCom Notes Receivable - UMC Notes Receivable - Tapper's III Notes Receivable - WSI Notes Receivable - Tapper's Holdings Appropriations Receivables - 2005- MIF (Fed) MIF (State) TOTAL ASSETS FUND EOUITY Fund Balance Reserved for Participation Loans * (Economic Development) TOTAL LIABILITIES AND FUND EQUITY $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ -0- $ 2,697.38 $ -0- $ -0- $ -0- $ -0- $ 25,767.75 $ -0- $ 177,891.20 $ 41,777.22 $ 332,638.03 $ 199,423.41 $ -0- $ -0- .2003 transfer to Liquor Fund $70,000 2001 transfer to Liquor Fund $77,000 Original Liquor Fund transfer to EDA $383,000. $ 861,281. 75 $1. 641. 476.74 $1.641.476.74 $1.641.476.74 . MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY MONTICELLO GREATER MONTICELLO ENTERPRISE FUND (GMEF) Statement of Revenues, Expenditures, and Changes in Fund Balance For the Year Ended December 31, 2005 REVENUES Appropriations - 2005 MIF (Fed) MIF (State) Interest Income - GMEF Notes Interest Income - DMRF Note Interest Income - Investment GMEF (?) Interest Income - Investment UDAG Interest Income - Investment SCREG Interest Income - Investment MIF Loan Fees Legal Fees Miscellaneous TOTAL REVENUES .PENDITURES GMEF Loans - GMEF Legal Fees GMEF Professional Fees TRANSFER TO LIQUOR FUND DMRF Loan - DMRF Grant - DMRF Legal Fees DMRF Professional Fees Service Fees Miscellaneous Other Int. Adjustment - Notes TOTAL EXPENDITURES Excess of Revenues Over Expenditures FUND BALANCE - Beginning of Year FUND BALANCE - End of Year . $ -0- $ -0- $ 15,504.37 $ -0- $ -0- $ -0- $ -0- $ -0- $ 200.00 $ 1,262.50 $ -0- MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY GREATER MONTICELLO ENTERPRISE FUND (GMEF) . 2006 CASH FLOW PROJECTION BEGINNING CASH BALANCE, January 2006 RECEIPTS Appropriations, Expected - MIF Fed or State Notes Amortization Payments - Tapper Inc. Muller Theatre SMM, Inc. Aroplax Corp. Custom Canopy, Inc. Standard Iron Vector Tool Tapper's II SELUEMED T.J. Martin ($547.60 Mo.) Mainline Distrib. ($702.08 Aroplax Corp. II ($730.93 TCDC IRTI EDMA ($193.89 Mo.) 9-06 VisiCom 11-05 UMC ($1,084.33 Mo.) 3-08 Tapper 111($524.76 Mo.) 5-08 WSI ($1,483.49 Mo) 6-09 Tapper Holdings ($1,417 Mo.) 7-10 Interest Income - Investment (est.) Loan Fees Loan Fees Other Miscellaneous 6-06 Mo. ) Mo. ) 6-04 12-04 . TOTAL RECEIPTS TOTAL BEGINNING BALANCE AND RECEIPTS EXPENDITURES GMEF Loans - Karlsburger Other Re-payment to Liquor Fund 2006 DMRF Grant Liquor Fund Balance Legal Fees eiscellaneous TOTAL EXPENDITURES EXPECTED CASH BALANCE, December 2006 $ 100,000.00 $ 100,000.00 -0- $ 143,890.66 $ 3,000.00 $ 1.000.00 $ 861,281.75 $ 347,890.66 $ 631,276.37 . . . 2005 ECONOMIC DEVELOPMENT AUTHORITY ACTIVITY REPORT MEETING DATE SUBJECTS February 10, 2005 Reviewed the Loan Application, held public hearing on business subsidy, and motion to approve GMEF Loan No. 024, a real estate rehabilitation loan, for Tappers Holdings LLC in the amount of$200,OOO. Fixed rate of3.5%, amortized over 20 years, ballooned in 5 years. Application fee $200. April 26, 2005 Motion to approve EDA Officers for 2005: President Bill Demeules Vice President Barb Schwientek Treasurer Rick Wolfsteller Assistant Treasurer Ron Hoglund Secretary Ollie Koropchak Motion to accept the EDA 2005 Year-End Financial Statements and Activity Report for submission to the City Council on May 9 or 23,2005. All existing GMEF loan paybacks are current. Motion to table discussion on payback to Liquor Store Fund until October meeting. Motion to accept the Business Subsidy Criteria and Bylaws of the EDA as written (no amendments.) August 9, 2005 Motion to extend the non-performance date up to an additional 120 days from August 10,2005, to December 10, 2005, for approved GMEF Loan No. 024 with the applicant to pay legal expenses to amend the Loan Agreement and to waive the 30 day notification period for extension. Motion agreeing to a shared fourth position with CMIF for GMEF Loan No. 024 with option to move to fifth position if necessary, with the notation that the applicant pay the associated legal fees for the document changes. 1 . Continued 2005 Economic Development Authority Report Motion agreeing to continue tracking the late fees per the GMEF Loan No. 014 Agreement and accept payments on a monthly basis as required. October 25, 2005 Motion to call DMRF Loan No. 111, principal and interest due, in the amount of $5,275.00, due and payable within 60 days of November 1, 2005. Deferred the loan payment to foster a downtown business and keeps the fmalloan payment clean. Motion to table any action for authorization to payback any remaining Liquor Store Fund dollars. . Motion to research establishment and preparation of criteria for re-use of the Federal dollars from the TCDC loan. Suggested terms: 0% interest rate with balloon payment in three years or up to 3% below prime rate with balloon payment in five years. Called for a special in November and to further research with the State representative and EDA Attorney. November 29, 2005 Minutes not available and not approved. Agenda subjects: Review proposed modifications to the GMEF Guidelines to accommodate re-use of Federal dollars. Call for public hearing date for modification of the EDA Business Subsidy Criteria. Ratify the Mortgage Subordination Agreement between the SBA, EDA, and Tapper Holdings LLC. December 13, 2005 Public Hearing and approved the proposed amendments to the Monticello EDA Business Subsidy Criteria: 0% interest rate with balloon payment in three years or up to 3% below prime rate with balloon payment in five years. Applicant subject to Federal requirements including 51 % of jobs must be made available to or held by LMI persons. Also requested submission of the Designated Local Development Organization Council Resolution and amended Criteria to DEED for approval. . 2 . . . EDA Agenda - 04/25/06 6. Consideration to review summary of 2005 vear-end balances of the GMEF. UDAG. MIF and SCERG Funds. A. Reference and Backl!l"ound: GMEF No. 024 (Tappers Holding LLC) was approved and disbursed in 2005. Two balloon payments are due in 2006: GMEF No. 014 (TJ Martin) and GMEF No. 019 (EDAM). The VisiCom Loan balloon payment was paid in 2005. All GMEF loan paybacks are current. Current balance of remaining Liquor Store Funds is $180,891 ($383,000 less $77,000; $70,000, and DMRF expenditures of $55, 1 09 = $180.891). The EDA previously terminated the DMRF Program. Additional funds available for future use by the EDA include the MlF Federa1- TCDC (2005 balance $331,307). MlF-State-UMC (2005 balance $27,983). The MIF balances do not include interest income - investment. The SCERG Fund was closed out in 2004 and all monies have been recycled. All UDAG-FSI dollars have been recycled. The MIF Federal-CitylTCDC Grant was closed-out on June 20, 2005, however, the City must continue to report on loan repayments and the use of the city's revolving loan fund on a yearly basis, due January 25 of each year until dollars are recycled once. The EDA prepared for the use of the Federal revolving loan fund by amending the EDA Business Subsidy Criteria to include that the applicant must agree to meet the criteria set by HUD (family income levels and Davis Bacon Act.) No restriction apply to the MIF-State-UMC; however, the EDA retains only the first $100,000 plus interest. Funds available for EDA loans: GMEF Cash $861,281.75 + MIF State $27,983 = $889,262 and MIF Federal $331,307. This assumes no reimbursement to Liquor Store Fund. No action necessary by the EDA. 1 . . MINNESOTA INVESTMENT FUND FINANCIAL REPORT December 31,2005 GRANT TOTALS. TWIN CITIES DIE CAST Ifederall Payback began in July, 2000 for 7 years ending in June, 2007. Annual principal and interest payback total is $61,176.72. Principal Interest TOTAL EXPENDED: ORIGINAL $500,000.00 $95,747.11 $595,747.11 $468,266.60 $20,859.00 $10,874.40 $500,000.00 PAID $248,442.13 $82,865.10 $331,307.23 6/2100 8/9/00 8/15/00 GRANT TOTALS - UMCITOMANN Istatel Payback began in October 2003 for 5 years ending in March 2008. Annual principal payback is $19,280.64. City keeps first $100,000 plus interest. Principal Interest TOTAL EXPENDED: ORIGINAL $290,000.00 $33,439.16 $323,439.16 $92,138.56 $109,377.84 $88,483.60 $290,000.00 PAID $24,409.98 $17,370.66 $41,780.64 4/17/03 6/26/03 9/4/03 REMAINING $251,557.87 $12,882.01 $264,439.88 REMAINING $265,590.02 $16,068.50 $281,658.52 ~_._._._._-------------------------------------------------- . REVENUES Principal Payback - TCDC (fed) Interest Payback - TCDC (fed) Principal Payback - UMC (st) Interest Payback - UMC (st) Interest Income - Investment: 2000 2001 2002 2003 2004 2005 TOTAL REVENUES EXPENDITURES Prof Svc fees - TCDC (fed) Legal fees - TCDC (fed) Transfer to GMEF - 2004 WSI 023 (st) TOTAL EXPENDITURES FUND BALANCE FOR MN INV FUND EDA annual reports 2005.xls: 4/21/2006 $248,442.13 $82,865.10 $24,409.98 $17,370.66 $119.19 $3,071.00 $5,356.00 $7,678.00 $9,157.00 $398,469.06 $3,306.55 $824.75 $13,797.86 $17,929.16 $380,539.90 . . . SMALL CITIES ECONOMIC RECOVERY GRANT (SCERG) FINANCIAL REPORT December 31,2005 REVENUES Principal Payback - Aroplax Interest Payback - Aroplax Loan Payback - Standard Iron Grant Administrative Fee - S. I. Refund 97198 fee to Wright County Interest Income - Investment: 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 $175,615.55 $24,018.99 $321,029.16 $6,260.00 ($2,000.00) $1,061.92 $1,256.00 $5,475.97 $7,381.27 $8,770.56 $9,741.95 $10,450.10 $9,058.60 $682.00 $554.00 $513.00 $570.00 TOTAL REVENUES $580,439.07 EXPENDITURES Payback to State - Aroplax Reimbursement to Wright Co - S.1. Transfer to GMEF - T. J. Martin Transfer to GMEF - Mainline Dist Transfer to GMEF - TC Die Cast Transfer to GMEF - WSI TOTAL EXPENDITURES $75,626.64 $317,458.65 $87,500.00 $60,453.62 $23,198.02 $16,202.14 $580,439.07 FUND BALANCE FOR SMALL CITIES GRANT ($0.00) EDA annual reports 2005.xls: 412012006 2 . . SMALL CITIES ECONOMIC RECOVERY GRANT (SCERG) FINANCIAL REPORT December 31, 2005 GRANT TOTALS - AROPLAX Payback began in December, 1992 for 7 years ending in November, 1999. Annual principal and interest payback total is $29,801.40. First $100,000 principal payback ends January, 1997. Principal Interest TOTAL ORIGINAL $170,000.00 $37,969.92 $207,969.92 PAID $175,615.55 $24,018.99 $199,634.54 REMAINING ($5,615.55) $13,950.93 $8,335.38 Principal Interest TOTAL Jan. 1997 $170,000.00 $29,634.75 $199,634.75 GMEF $100,000.00 $24,018.99 $124,018.99 STATE $70,000.00 $5,615.76 $75,615.76 ..------------.-----------..-.---------------.-...-...------------- . Grant must be expended by December 31,1994, up to $170,000. EXPENDED: $116,556.75 $16,996.18 $12,356.59 $4,021.10 $15,132.50 $4,936.88 $170,000.00 1993 1993 1993 1/18/94 4/13/94 7/20/94 GRANTTOTALS-STANDARDIRON Payback began in July, 1994 for 7 years ending in June, 2001. Annual principal and interest payback total is $33,306.12. Grant must be expended by December 31, 1994, up to $250,000. EXPENDED: $250,000.00 8/18/94 EDA annual reports 2005.xls: 4/20/2006 1 . URBAN DEVELOPMENT ACTION GRANT (UDAG) FINANCIAL REPORT December 31,2005 GRANT TOTALS - FSI Payback began in January, 1988 for 12 years ending in January, 2000. Annual principal and interest payback total is $27,971.40. Principal Interest TOTAL ORIGINAL $256,957.71 $78,700.35 $335,658.06 PAID $256,957.71 $77,315.88 $334,273.59 REMAINING $0.00 $1,384.47 $1,384.47 .--------.-------------------.-----------------------------, . . REVENUES Principal Payback - FSI Interest Payback - FSI Interest Income - Investment: 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 $256,957.71 $77,315.88 $6,342.02 $8,593.59 $8,436.32 $5,227.10 $3,756.77 $12,297.72 $9,775.19 $9,007.60 $12,989.27 $13,128.25 $423,827.42 TOTAL REVENUES EXPENDITURES 1991 Transfer to GMEF (Tapper & Muller) 19~2 Transfer to GMEF (Aroplax) 1993 Transfer to GMEF (Custom Canopy) 1996 Transfer to GMEF (Tapper) 1999 Transfer to GMEF (Aroplax) 1999 (2000) Transfer to GMEF (Mainline) 2000 Transfer to GMEF (TC Die Cast) TOTAL EXPENDITURES $65,000.00 $20,000.00 $42,500.00 $100,000.00 $100,000.00 $39,546.38 $56,781.04 $423,827.42 FUND BALANCE FOR URBAN DEVELOPMENT ACTION GRANT $0.00 EDA annual reports 200S.xls: 4/20/2006 . GREATER MONTICELLO ENTERPRISE FUND (GMEF) LOAN STATUS December 31, 2005 Economic Development Authority (EDA) was created in 1989. APPROVED LOANS Tapper/Genereux (1990) $88,000.00 Muller/Monti Theatre (1990) $50,000.00 Barger/Suburban #004 (1992) $50,000.00 Schoen/Aroplax #005 (1992) $85,000.00 Birkeland/Custom Canopy #006 (1993) $42,500.00 Demeules/Standard Iron #007 (1993) $75,000.00 Blue Chip DevNector Tool #010 (1995) $50,000.00 Tapper's #011 (1996) $100,000.00 Standard Iron/Seluemed #013 (1996) $70,000.00 T J Martin #014 (1998) $87,500.00 Mainline Distr #015 (1999) $100,000.00 Aroplax #016 (1999) $100,000.00 TC Die Cast #017 (2000) $100,000.00 Integrated Recycling #018 (2001) $72,500.00 . EDMA#019 (2001) $30,000.00 Tapper's #021 (2002) $55,000.00 Tomann/UMC #022 (2002) $200,000.00 WSllndustries #023 (2004) $350,000.00 Tappers Holdings #024 (2005) $200,000.00 TOTAL APPROVED LOANS $1,905,500.00 APPROVED PAYBACKS 2001 to Hwy Liquor ($77,000.00) 2003 to Hwy Liquor ($70,000.00) TOTAL APPROVED PAYBACKS ($147,000.00) TOTAL APPROVED LOANS & PAYBACKS $1,758,500.00 LOAN DISBURSEMENTS (transferred to GMEFI Liquor Fund: 1991 to Tapper $73,000.00 1992 to Suburban $50,000.00 1992 to Aroplax $65,000.00 1994 to Standard Iron $75,000.00 1995 to Vector Tool $50,000.00 . 1996 to Standard Iron $70,000.00 2001 payback from EDA ($77,000.00) 2003 payback from EDA ($70,000.00) Total Liquor Fund $236,000.00 EDA annual reports 2005.xls: 4/20/2006 1 . GREATER MONTICELLO ENTERPRISE FUND (GMEF) LOAN STATUS December 31, 2005 UDAG Fund: 1991 to Tapper $15,000.00 1991 to Muller $50,000.00 1992 to Aroplax $20,000.00 1993 to Custom Canopy $42,500.00 1996 to Tapper's $100,000.00 1999 to Aroplax (016) $100,000.00 1999 (2000) to Mainline $39,546.38 2000 to TC Die Cast $56,781.04 Total UDAG Fund $423,827.42 UDAG (recycled funds): 2001 to Integrated Recycling $72,500.00 2001 to EDMA $30,000.00 2003 to UMC 022 $125,000.00 2004 to WSI 023 $260,000.00 Total Recycled UDAG $487,500.00 . SCERG Fund: 1998 to T J Martin 014 $87,500.00 1999 to Mainline 015 $60,453.62 2000 to TC Die Cast 017 $23,198.02 2004 to WSI 023 $16,202.14 Total SCERG Fund $187,353.78 SCERG (recycled funds): 2004 to WSI 023 $60,000.00 Total Recycled SCERG $60,000.00 MN INV Fund: 2004 to WSI 023 (recycled state funds) $13,797.86 Total MIF $13,797.86 GMEF (recycled funds): 2000 to TC Die Cast 017 $20,020.94 2003 to UMC 022 $75,000.00 2003 to Tapper 021 $55,000.00 2005 to Tapper Holdings 024 $200,000.00 Total GMEF Fund $350,020.94 . TOTAL LOAN DISBURSEMENTS $1,758,500.00 EDA annual reports 2005.xls: 4/20/2006 2 0 C'" to i' ~ . 0 I{) 0 (!) ~ ~ CO C") C") I{) CO ~ ~ I{) ..;- 0) CO I{) C") ~ ~ - 0 (!) 0) (!) ~ <:t: ~ <:t: C\J co ~ ~ ~ ~ 0 ~ C\J C") ~ "< CO (!)e' ::r 0 r--: oi N to N cO 'J <( 0) C") 0 C") I{) C\J ~ I{) CD I{) 0) 0 C") ~('" ~ C") ..;- CO ~ C") CO ..;- C\J 0 C\J C\J ..;- ~ I{) C\J CO C") CO ~ -0 CL ~ CD C") 0) C\J C") I{) I{). (!). 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Consideration to review for amendment the Business Subsidv Criteria and Bvlaws of the EDA. A. Reference and backl!round: EDA Business Subsidv Criteria This is a housekeeping item. According to the Business Subsidy Criteria: "At a minimum, the EDA shall review the Fund Guidelines on an annual basis. No changes to the GMEF guidelines shall be instituted without prior approval of the City Council." "Amendments to these criteria are subject to public hearing requirements pursuant to Minnesota Statues, Section 116J.993 through 116J.994. " The criteria is attached for your review. EDA Bv1aws This a housekeeping item. According to the Bylaws: "The Bylaws of the Authority shall be amended by a majority vote of the Authority membership at a regular or special meeting. The amendment must be in written form." B. Alternative Action: EDA Business Subsidv Criteria 1. A motion to recommend amending the Business Subsidy Criteria as follows ............................., requesting approval from City Council, and calling for a public hearing. 2. A motion to accept the Business Subsidy Criteria of the EDA as written. EDA Bvlaws 1. A motion to recommend amending the Bylaws as follows ............... to be drafted in written form. 2. A motion to accept the Bylaws of the EDA as written. 1 . EDA Agenda - 04/25/06 C. Recommendation: Recommendation is alternative no. 2 for both the Criteria and Bylaws. D. SUDDortinl!: Data: Copy of Business Subsidy Criteria and Bylaws of the EDA. . . 2 Ji- , , -~ , , ~ MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA Business Subsidy Criteria Public Hearing and Adoption the 31st day of August, 1999 Public Hearing and Adoption of Amendments the 8th day of November, 2000 Public Hearing and Adoption of Amendments the 24th day of April, 2001 Public Hearing and Adoption of Amendments the 13th day of December, 2005 1. PURPOSE . 1:01 The purpose of this docwnent is to establish the Economic Development Authority's criteria for granting of business subsidies, as defined in Minnesota Statutes 116J.993, Subdivision 3, for private development. This criteria shall be used as a guide in processing and reviewing applications requesting business subsidies. 1 :02 The criteria set forth in this docwnent are guidelines only. The Economic Development Authority reserves the right in its discretion to approve business subsidies that vary from the criteria stated herein if the Economic Development Authority determines that the subsidy nevertheless serves a public purpose. The Authority will file evidence of any deviation from these criteria with the Department of Trade and Economic Development in accordance with Minnesota Statues, Section 1161.994, Subd. Z. 1 :03 The Economic Development Authority may amend the business subsidy criteria at any time. Amendments to these criteria are subject to public hearing requirements pursuant to Minnesota Statutes, Sections 1161.993 through 1161.994. 2. STATUTORY LIMITATIONS 2:01 In accordance with the business Subsidy Criteria, Business Subsidy requests must comply with applicable State Statutes. The Economic Development Authority ability to grant business subsidies is governed by the limitations established in Minnesota Statutes 1161.993 through 116J.994. 3. PUBLIC POLICY REQUIREMENT . 3:01 All business subsidies must meet a public purpose in addition to increasing the tax base. Job retention may only be used as a public purpose in cases where job loss is imminent and demonstrable. 1 Monticello City Hall, 505 Walnut Street, Suite I, Monticello, MN 55362-883 I . (763) 295-271 I . Fax: (763) 295-4404 Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 . (763) 295-3170' Fax: (763) 271-3272 . . . 4. BuSINESS SUBSIDY APPROVAL CRITERIA 4:01 All new projects approved by the Economic Development Authority should meet the following minimum approval criteria. However, it should not be presumed that a project meeting these criteria will automatically be approved. Meeting these criteria creates no contractual right on the part of any potential developer or the Economic Development Authority. 4:02 The project must be in accord with the Comprehensive Plan and Zoning Ordinance, or required changes to the plan and ordinances must be under active consideration by the City at the time of approval. 4:03 Prior to approval of a business subsidies financing plan and when deemed appropriate by the Economic Development Authority, the developer shall provide any required market and financial feasibility studies, appraisals, soil boring information provided to private lenders for the project, and other information or data as requested. 4:04 A recipient of a business subsidy must make a commitment to continue operations at the site where the subsidy is used for at least five years after the benefit date. 4:05 (Recipients of any business subsidy will be required to meet wage and job goals determined by the Economic Development Authority on a case-by-case basis, giving consideration to the nature of the development, the purpose of the subsidy, local economic conditions, and situational circumstances.) The Economic Development Authority may determine after a public hearing that job creation or retention is not a goal of the subsidy. In those cases, the recipient must instead meet at least one of the following minimum requirements (in addition to all other criteria in this document other than those relating to jobs and minimum wages): (1) The proposed subsidy must accomplish removal, rehabilitation or redevelopment of "blighted areas" as defined in Minnesota Statues, Section 469.002, Subd.ll, or must constitute a cost of correction conditions that allow designation of redevelopment districts under Minnesota Statues, Sections 469.174 to 469.179; or (2) The proposed subsidy must result in improvements to public infrastructure or public facilities, including without limitations, sewers stom1 sewers, streets, parks, recreational facilities, and other City facilities; or (3) The proposed subsidy must remove physical impediments to development of 2 . . . EDA Business Subsidy Criteria land, including without limitation poor soils, bedrock conditions, steep slopes, or similar geotechnical problems. 4:06 For any business subsidy that does not meet the requirements of Section 4:05, the recipient must create or retain jobs as determined by the Economic Development Authority, as must meet the minimum wage thresholds, described in Section 5:03, Greater Monticello Enterprise Fund Guidelines, l.(b) (whether or not the source of the subsidy is tax increment financing). 5. GREATER MONTICELLO ENTERPRISE FUND PROJECT EV ALVA TION CRITERIA 5:01 The Economic Development Authority will utilize the Greater Monticello Enterprise fund to support the community's long-term economic goals. 5 :02 Each Greater Monticello Enterprise Fund subsidy will be analyzed and evaluated by the Economic Development authority. Each project shall be measured against the general criteria in Sections I through 4 and the specific criteria in this Section 5 applicable to the Greater Monticello Enterprise Fund subsidies. 5:03 Following are the evaluation criteria that will be used by the Economic Development Authority: DAWNfWORD/POLlCIES: 10/30100 3 . . . EDA Business Subsidy Criteria GREATER MONTICELLO ENTERPRISE FUND GUIDELINES CITY OF MONTICELLO 505 WALNUT STREET, SUITE #1 MONTICELLO, MINNESOTA 55362 (763) 271-3208 INTRODUCTION The purpose of the Greater Monticello Enterprise Fund (GMEF) is to encourage economic development by supplementing conventional financing sources available to existing and new businesses. Through this program administered by the Economic Development Authority and participating lending institution(s), loans are made to businesses to help them meet a portion of their financing needs. All loans must serve a public purpose by complying with four or more of the criteria noted in the next section. In all cases, it is mandatory that criteria #1 be satisfied, which requires the creation of new jobs. It is the responsibility of the EDA to assure that loans meet the public purpose standard and comply with all other GMEF policies as defined in this document. Along with establishing the definition of public purpose, this document is designed to outline the process involved in obtaining GMEF financing. DEFINITION OF PUBLIC PURPOSE I. To provide loans for credit worthy businesses that create new jobs. (a) One job is equivalent to a total of 37.5 hours per week. (b) At least 90% of the jobs created must pay a wage of the higher of $9.00 per hour, or at least 160% of the federal minimum wage, exclusive of benefits, for individuals over the age of20 during the term of the assistance. Annual written reports are required until termination date. Failure to meet the job and wage level goals require partial or full repayment of the assistance with interest. 2. To provide loans for credit worthy businesses that would increase the community tax base. 3. To assist new or existing industrial or commercial businesses to improve or expand their operations. Considerations for loans shall take into account factors including, but not limited to, the nature and extent of the business, the product or service involved, the present availability of the product or service within the city of Monticello, the compatibility of the proposed business as it relates to the comprehensive plan and existing zoning policies, and the potential for adverse environmental effects of the business, if any. 4. To provide loans to be used as a secondary source of financing that is intended to supplement conventional financing (bank financing). 5. To provide loans in situations in which a funding gap exists. 6. To provide funds for economic development that could be used to assist in obtaining other funds such as Small Business Administration loans, federal and state grants, etc. 4 DAWN/WORD/POLICIES: 10/30/00 . . . I. EDA Business Subsidy Criteria THE GREATER MONTICELLO ENTERPRISES REVOLVING LOAN FUND POLICIES BUSINESS ELIGIBILITY * Industrial businesses Non-competitive commercial businesses which enhance the community Businesses located within the city of Monticello Credit worthy existing businesses Non-credit worthy start-up businesses with worthy feasibility studies (Deny all historical non-credit worthy businesses) $10,000 loan per each job created, or $5,000 per every $20,000 increase in property market valuation, or $5,000 per every $20,000 increase in personal property used for business purposes, whichever is higher. * * * * . II. FINANCING METHOD . COMPANION DIRECT LOAN - Example: Equity 20%, RLF 30%, and bank 50%. (All such loans may be subordinated to the primary lender(s) if requested by the primary lender(s). The RLF loan is leveraged and the lower interest rate of the RLF lowers the effective interest rate on the entire project.) . PARTICIPATION LOAN - RLF buys a portion of the loan (the RLF is not in a subordinate position, no collateral is required by the RLF, and the loan provides a lower interest rate). * GUARANTEE LOANS - RLF guarantees a portion of the bank loan. (Personal and real estate guarantees handled separately.) III. USE OF PROCEEDS * . Real property acquisition and development Real property rehabilitation (expansion or improvements) Machinery and equipment * IV. TERMS AND CONDITIONS . Minimum of$5,000 and maximum not to exceed 50% of the remaining revolving loan fund balance; for exanlple, if the remaining revolving loan fund balance is $50,000, the maximum loan issuance is $25,000. LOAN SIZE - . Minimum 60% private/public non-GMEF Maximum 30% public (GMEF) Minimum 10% equity EDA loan LEVERAGING - OAWNIWORDiPOLICIE$: 1DJ30100 5 EDA Business Subsidy Criteria . * LOAN TERM - Personal property term not to exceed life of equipment (generally 5-7 years). Real estate property maximum of 5-year maturity amortized up to 30 years. Balloon payment at 5 years. * INTEREST RATE- Fixed rate not less than 2% below Minneapolis prime rate. Prime rate per National Bank of Minneapolis on date of ED A loan approval. * LOAN FEE - Minimum fee of $200 but not to exceed 1.5% of the total loan project. * Fees are to be> documented and no duplication of fees between the lending institution and the RLF. Loan fee may be incorporated into project cost. EDA retains the right to reduce or waive loan fee or portion of loan fee. *Fee to be paid by applicant to the EDA within 5 working days after City Council approval of GMEF loan. Nomefundable. * PREP A YMENT POLICY - No penalty for prepayment. * DEFERRAL OF . PAYMENTS -l. Approval of the EDA membership by majority vote. 2. Extend the balloon if unable to refinance, verification letter from two lending institutions subject to Board approval. * LATE PAYMENT Failure to pay principal or interest when due may POLICY result in the loan being immediately called. In addition to any other amounts due on any loan, and without waiving any right of the Economic Development Authority under any applicable documents, a late fee of $250 will be imposed on any borrower for any payment not received in full by the Authority within 30 calendar days of the date on which it is due. Furthermore, interest will continue to accrue on any amount due until the date on which it is paid to the Authority, and all such interest will be due and payable at the same time as the an10unt on which it has accrued. * INTEREST . LIMIT A nON ON GUARANTEED LOANS- Subject to security and/or reviewal by EDA. * ASSUMABILITY 6 DAWNIWORD/POLlCIES: 10130/00 EDA Business Subsidy Criteria . OFLOAN- None. * BUSINESS EQUITY REQUIREMENTS - Subject to type of loan; Board of Directors will determine case by case, analysis under normal lending guidelines. * COLLATERAL- * Liens on real property in project (mortgage deed). * Liens on real property in business (mortgage deed). * Liens on real property held personally (subject to Board of Directors - homestead exempt). * Machinery and equipment liens (except equipment exempt from bankruptcy). * Personal and/or corporate guarantees (requires unlimited personal guarantees). * NON-PERFORMANCE - An approved GMEF loan shall be null and void if funds are not drawn upon or disbursed within 180 days from date of ED A approval. . * NON-PERFORMANCE EXTENSION - The l80-day non-performance date can be extended up to an additional 120 days. 1. A VvTitten request is received 30 days prior to expiration of the l80-day non-performance date. 2. Approval of the EDA membership by majority vote. * LEGAL FEE - Responsibility of the GMEF applicant. The Greater Monticello Enterprise Fund is operated as an equal opportunity program. All applicants shall have equal access to GMEF funds regardless of race, sex, age, marital status, or other personal characteristics. V. ADDITIONAL CRITERIA FOR LOANS ORIGINATING THROUGH SMALL CITIES ECONOMIC DEVELOPMENT SET-ASIDE GRANT FUNDS * Compliance with federal labor standards laws, including: . The Davis-Bacon Act, which requires that workers receive no less than the prevailing wages being paid for similar work in the locality when the contract, financed in whole or part with federal funds, exceeds $2,000; 7 DAWNIWORD/POLlCIES 10/30/CO . . . EDA Business Subsidy Criteria The Contract Work Hours and Safety Standards Act, which requires that workers receive overtime compensation at a rate of 1-1/2 times their regular wage after they have worked 40 hours in one week; The Copeland "Anti-Kickback" Act, which requires that workers be paid at least once a week without any deductions or rebates except permissible deductions which include taxes, deductions the worker authorizes and those required by court processes. . Compliance with federal fair housing and civillhuman rights laws and with the Minnesota Human Rights law, which forbids discrimination in credit, employment, housing, public accommodations, public service and education on the basis of race, color, creed, religion, national origin, sex, marital status, disability, sexual orientation, public assistance or familial status. . Compliance with the Low and Moderate Income (LMI) Benefit National Objective, which, in the economic development context, has as its goal the creation and retention of jobs, of which a minimum of 51 % must be held by LMI persons, defined as a member of a family having an income less than or equal to the Section 8 low-income limit established by the U.S. Department of Housing and Urban Development (HUD). . Compliance with requirements of the National Environmental Policy Act (NEP A) of 1969, as amended, and preparation of an Environmental Review Record. . Compliance with Section 104(d) of the federal Housing and Community Development Act of 1974, as amended, which requires that any reduction in LMI dwelling units in the community must be offset by the creation of similar affordable units and relocation assistance to displaced LMI families; and with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended, which mandates procedures to ensure fair and equitable treatment for persons displaced by projects designed for the public good. . Terms and conditions for federal money: - Interest Rate: 0% with balloon payment in three years or fixed rate not less than 3% below Minneapolis prime rate with balloon payment in five years. - All other terms and conditions are as outlined in The Greater Monticello Enterprises Revolving Loan Fund Policies, Section IV, above. DAWNrwORDIPOLlCIES: 10/30/00 8 . . . EDA Business Subsidy Criteria ORGANIZATION The Greater Monticello Enterprise Fund is administered by the City of Monticello Economic Development Authority (EDA), which is a seven-member board consisting of two Council members and five appointed members. EDA members are appointed by the Mayor and confirmed by the City Council. Formal meetings are held on a quarterly basis. Please see the by-laws of the EDA for more information on the structure of the organization that administers the Greater Monticello Enterprise Fund. PARTICIPATING LENDING INSTITUTION(S) I. Participating lending institutions(s) shall be determined by the GMEF applicant. 2. Participating lending institution(s) shall cooperate with the EDA and assist in carrying out the policies of the GMEF as approved by the City Council. 3. Participating lending institution(s) shall analyze the formal application and indicate to the EDA the level at which the lending institution will participate in the finance package. LOAN APPLICA TIONI ADMINISTRATIVE PROCEDURES The EDA desires to make the GMEF loan application process as simple as possible. However, certain procedures must be followed prior to EDA consideration of a loan request. Information regarding the program and procedures for obtaining a loan are as follows: City Staff Duties: The Economic Development Director, working in conjunction with the Assistant City Administrator, shall carry out GMEF operating procedures as approved by the EDA and Council. Staff is responsible for assisting businesses in the loan application process and will work closely with applicants in developing the necessary information. Application Process: I. Applicant shall complete a preliminary loan application. Staff will review application for consistency with the policies set forth in the Greater Monticello Fund Guidelines. Staff consideration of the preliminary loan application should take approximately one week. Staff will ask applicant to contact a lending institution regarding financing needs and indicate to applicant that further action by the EDA on the potential loan ",ill require indication of support from a lending institution. 2. If applicant gains initial support from lending institution and if the preliminary loan application is approved, applicant is then asked to complete a formal application. If the preliminary loan application is not approved by staff, the applicant may request that the EDA consider approval of the preliminary application at the next regularly schednled meeting of the EDA. 9 DAWNMJORDIPOUCIES: 10/30/00 . . .1. EDA Business Subsidy Criteria , ~. If the preliminary loan application is approved, applicant shall complete a formal application. Formal application shall include a business plan which will include its management structure, market analysis, and financial statement. Like documentation necessary for obtaining the bank loan associated with the proposal is acceptable. Attached ",ith each formal application is a written release of information executed by the loan applicant. 4. City staff will meet with applicant and other participating lender(s) to refine the plan for financing the proposed enterprise. 5. City staff shall analyze the formal application and financial statements contained therein to determine if the proposed business and finance plan is viable. Staff may, at its discretion, accept the findings of a banking institution regarding applicant credit and financial viability of the project. After analysis is complete, City staff shall submit a "'Titten recommendation to the EDA. A decision regarding the application shall be made by the EDA within 60 days of the submittal of a completed formal application. 6. The EDA shall have authority to approve or deny loans; however, ~thin 21 days of EDA approval, the City Council may reverse a decision by the EDA to approve a loan ifit is determined by Council that such loan was issued in violation ofGMEF guidelines. 7. Prior to issuance of an approved loan, the City Attorney shall review and/or prepare all contracts, legal documents, and intercreditor agreements. After such review is complete, the City shall issue said loan. ORIGINAL REVOLVING LOAN FUNDING "LETTER OF CREDIT" FROM MONTICELLO CITY COUNCIL - $200,000 SOURCE - City Liquor Store Fund City shall transfer needed loan amount from existing accounts at such time that individual loans are approved. Revenue created through this program shall be under the control of the EDA and shall not be transferred to City funds unless the City Council determines that reserves generated are not necessary for the successful operation of the Authority. If such is the case, such funds must be transferred to the debt service funds of the City to be used solely to reduce tax levies for bonded indebtedness of the City (see Section 5 B of the ordinance establishing the Monticello EDA). REPORTING 1. Staff shall submit quarterly slilllmaries and/or aJmual report detailing the status of the Monticello Enterprise Fund. FUND GUIDELINES MODIFICATION At a minimum, the EDA shall review the Fund Guidelines on an annual basis. No changes to the GMEF guidelines shall be instituted without prior approval of the City Cowlcil. DAWNfWORD/POLlCIES: 10/30/00 10 . . . EDA Business Subsidy Criteria LOAN ADMINISlRA lION L City staff shall service City loan, shall monitor City position with regard to the loan, and shall assure City compliance with intercreditor agreement. 2. All loan documents shall include an intercreditor agreement which must include the following: A. Definition of loan default, agreements regarding notification of default. B. Agreements between lending institution and City regarding reproduction of pertinent information regarding the loan. 3. All loan documentation shall include agreements between borrower and lenders regarding release of privacy regarding the status of the loan. 11 DAWNI\NORDIPOLlCIES: 10/30100 . . . Under the GMEF Guidelines use of proceeds for real property acquisition and development, real property rehabilitation (expansion or improvements) and machinery and equipment. The following commentary is intended to assist developers with those costs typically considered eligible: Real Property ACQuisition and Improvement Costs Land Acquisition Engineer/Design Inspection Fees Architect Fees Soil borings Appraisal Fees Legal Fees Environmental Study Recording Fees Title Insurance Building Permit Fees Building materials Construction labor Landscaping Grading Curbing/Parking Lot Machinery and Eauipment Costs Personal property used as an integral part of the manufacturing or commercial business, with a useful life of at least three years. Acquisition costs would include freight and sales taxes paid. As a general rule, office equipment would not qualify. . . . BYLAWS OF THE ECONOMIC DEVELOPMENT AUTHORITY ARTICLE I - THE AUTHORITY Section 1. Name of Authoritv. The name of the Authority shall be the "City of Monticello Economic Development Authority." Section 2. Office of Authoritv. The office of the Authority shall be at the City Hall in the City of Monticello, State of Minnesota, but the Authority may hold its meetings at such other place or places as it may designate by resolution. Section 3. Seal of Authoritv. The seal of the Authority shall be in the form of a circle and shall bear the name of the Authority and the year of its organization. Section 4. Establishment. The City of Monticello Economic Development Authority is e established pursuant to Minnesota Statutes, Section 469.090 to 469.108, and adopted by Ordinance Amendment No. 172, Chapter 3, City of Monticello, Wright County, Minnesota. ARTICLE II - THE COMMISSIONERS Section 1. Appointment. Terms. Vacancies. Pav. and Removal. Shall be in accordance to the Monticello Ordinance Amendment No. 172, Chapter 3, Economic Development Authority, Section 2-3-1: Creation. ARTICLE III - THE OFFICERS Section I. Officers. The Authority shall elect a president, a vice president, a treasurer, a secretary, and an assistant treasurer at the annual meeting. A commissioner must not serve as president and vice president at the same time. The other offices may be held by the same commissioner. The office of secretary and treasurer need not be held by a commissioner. Section 2. Duties and Powers. The officers have the usual duties and powers of their offices. They may be given other duties and powers by the Authority. BYLA WS.EDA: 5/13/91 AMENDED: 5/22/01 Page I . . . Section 3. Treasurer's Duties. The treasurer: (I) shall receive and is responsible for Authority money; (2) is responsible for the acts of the assistant treasurer; (3) shall disburse Authority money by check only; (4) shall keep an account of the source of all receipts and the nature, purpose, and authority of all disbursements; (5) shall file the Authority's detailed financial statement with its secretary at least once a year at times set by the Authority. (6) shall prepare and submit an annual report describing its activities and providing an accurate statement of its financial condition to the City of Monticello by March I each year. Section 4. Assistant Treasurer. The assistant treasurer has the powers and duties ofthe treasurer if the treasurer is absent or disabled. Section 5. Public Monev. Authority money is public money. ARTICLE IV - EXECUTIVE DIRECTOR The Economic Development Director shall be designated as Executive Director of the Authority. Section I. Duties. The Executive Director shall have general supervision over the administration of its business and affairs subject to the direction of the Authority. As secretary, the Executive Director in his own name and title shall keep the records of the Authority, shall act as Secretary of the meetings of the Authority and record all votes, and shall keep record of the proceedings of the Authority in a journal of proceedings to be kept for such purpose, and shall perform all duties incident to the office. The Executive Director shall keep in sole custody the seal of the Authority and shall have power to affix such seal to all contracts and instruments authorized to be executed by the Authority. Any person appointed to fill the office of Executive Director, or any vacancy herein, shall have such terms as the Authority fixes, but no commissioner of the Authority shall be eligible to this office. ARTICLE V - MEETINGS Section I. Regular Meetings. Quarterly meetings shall be held upon oral or written notice at the regular meeting place of the Authority on the 41h Tuesday of January, April, July, and October. BYLA WS.EDA: 5/13/91 AMENDED: 5/22/01 Page 2 . Section 2. Annual Meeting. The annual meeting of the Authority shall be held in conjunction with the regular April meeting at the regular meeting place of the Authority. Section 3. Special Meetings. Special meetings of the Authority may be called by the president or two members of the Authority for the purpose of transacting any business designated in the call. All commissioners of the Authority shall be notified. Section 4. Ouorum. At any meeting of the Authority, the presence of four commissioners shall constitute a quorum. If a quorum is not present at any meeting, those present shall have power to adjourn the meeting from time to time without notice other than announcement at such meeting until the requisite number of votes shall be present to constitute a quorum. At any such adjourned meeting at which a quorum is present, any business may be transacted which might have been transacted at the meeting as originally called. Any resolution, election, or other formal action of the Authority shall be adopted upon the affirmative vote ofa majority of the Authority membership. Section 5. Order of Business. At the regular meetings of the Authority the following shall be the order of business: 1. 2. , J. . 4. 5. 6. 7. 8. 9. Call to order. Roll call. Reading and approval of the minutes of the previous meeting. Bills and communications. Report of the Executive Director. Report of committees. Unfinished business. New business. Adjournment. All resolutions shall be in 'writing and shall be copied in the journal of the proceedings of the Authority. Section 6. Unless otherwise specified in the agreement or in these bylaws, all meetings of the Authority shall be conducted in accordance with Roberts' Rules of Order revised. Section 7. Manner of Voting. The voting on all questions coming before the Authority shall be by roll call, and the yeas and nays shall be entered upon the minutes of such meetings. ARTICLE VI - EMPLOYEES; SERVICES; SUPPLIES Section I. Emplovees. Subject to limits set by the appropriations or other funds made available, the Authority may employ such staff, technicians, and experts as may be deemed proper and may incur such other expenses as may be necessary and proper for the conduct of its affairs. . BYLA WS.EDA: 5/13/91 AMENDED: 5/22/01 Page 3 . Section 2. Contract for Services. The Authority may contract for services of consultants, agents, public accountants, and other persons needed to perform its duties and exercise its powers. Section 3. Legal Services. The Authority may use the services of the city attorney or hire a general counsel for its legal needs. The city attorney or general counsel, as determined by the Authority, is its chieflegal advisor. Section 4. Supplies. The Authority may purchase the supplies and materials it needs to carry out Sections 469.090 to 469.]08. Section 5. Citv Purchasing. An authority may use the facilities of its city's purchasing department in connection with construction work and to purchase equipment, supplies, or materials. Section 6. Citv Facilities. Services. A city may fumish offices, structures and space, and stenographic, clerical, engineering, or other assistance to its authority. Section 7. Delegation Power. The Authority may delegate to one or more of its agents or employees powers or duties as it may deem proper. ARTICLE VII - POWERS . Section]. Functions. Powers. and Duties. Shall be in accordance to the Monticello Ordinance Amendment No. ] 72, Chapter 3, Economic Development Authority, Section 2-3-4: Functions, Power, and Duties. Section 2. Limitations of Power. Shall be in accordance to the Monticello Ordinance Amendment No. ] 72, Chapter 3, Economic Development Authority, Section 2-3-5: Limitation of Power. ARTICLE VIIl- AMENDMENTS Section I. Amendment to Bvlaws. The bylaws of the Authority shall be amended by a majority vote of the Authority membership a regular or special meeting. The amendments must be in written form. Section 2. In any instance where these bylaws are in conflict with the Ordinance Amendment No. 172, Chapter 3, Economic Development Authority, such Ordinance Amendment shall control. BYLA WS.EDA 5/13/9] . AMENDED: 5/22/01 Page 4 . . . Section 3. These bylaws are effective upon their adoption by the Authority. Dated: ,1990. Signed: President (Seal) Executive Director BYLA WS.EDA: 5113/91 AMENDED: 5/22/01 Page 5 . . . EDA Agenda - 04/25/06 8. Executive Director's ReDort. * Karlsburger Foods, Inc. is looking at applying for a GMEF Loan. The TIF process is about complete, a complete set ofthe site and building plans have not been submitted to the city for staff review, the plat is in process of being platted, and plans were ordered to install water/sewer trunk line. 20 jobs, 20,000 sq ft building. * 10,000 sq ft user - Questions on Preliminary Development Agreement for TIP from their attorney forwarded to HRA Attorney. Perhaps project this year. Does fit criteria. * 10,000 user - Identified as other industrial, 18 jobs at $8.50 average per our w/o benefits. Preliminary application does not fit criteria. Can pay market price. *10,000 user - imports cabinet for new and remodeling. With assemble for wholesale use. 20 employees, start-up business. Have not received preliminary application. * 10,000-15,000 sq ft building - currently in two locations, St Cloud and St Louis Park. 20 employees. Light industrial. Need to call back. * CB Richard Ellis, Richard Grapf - looking for land * Computer repair company - Looking to purchase Clow Stamping. They check and repair computer equipment for customers such as Target. About 40 employees. Looking at SBA and maybe our loan program. * Construction company - 3+ acres. Need outdoor storage. * 50,000 sq ft of cold storage. Wright County company. * Others I need to follow-up with. (Check with Precision Technologies) * For sale - 4.4 acres ofI-2 along Dundas Road. Ken Spaeth, Rogers. * HRA modifying three older TIF Districts to maximize use oftax increment. TIP No. 1-2, 1- 6, and 1-24. * Marketing Committee - Preparing 2007 Budget and Marketing campaign. Erect sign at entrance of business center along Chelsea Road, again lease billboard along 1-94 between Rogers and Maple Grove, do brochures and post cards, keep website updated and inserts. * Fiber optic task force - Will be meeting with consultant firm, CG Consultant and Springsted to define Contract. Consultant to begin gathering local information. * A VR has accepted the City's offer. No plans submitted. Mayor not convinced it's for real. * Transformation Home Loan - HRA modified to criteria to encourage use of the program. Number of people have inquired. Have one application on my desk for review. * HRA and city staff working with Ehlers to reconcile city coding for consistency with State Auditors requirements. February 15,2006 1--1 MONTICELLO VisiCom, Inc. Bruce and Cindy Hamond P.O. Box 488 Monticello, MN 55362 Re: Notice of Default on OMRF Loan No. Ill. Dear Bruce and Cindy: ~ This is a notice of default on the balloon payment for DMRF Loan No. Ill. At the Monticello Economic Development Authority (EOA) meeting of October 25,2005, the commissioners made a motion "to call DMRF Loan No. III principal and interest due November 1,2005, in the amount of $5,275.00, payment due and payable within 60 days of November 1,2005." Sixty-days being January 1,2006. Per the Loan Agreement dated April I, 2001, between VisiCom, Inc. and the Monticello EOA, an Event of Default is the failure to pay any principal and interest on the loan when due. Please remit the balloon payment due within five business days in the amount of$5,275.00 to the Monticello EDA, 505 Walnut Street, Suite I, Monticello, MN 55362. Should YOLI have any questions, please call me at 763-271-3208. Sincerely, MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY O~\~rf'\V~-O~ Ollie Koropchak Executive Director c: Monticello EOA ,/ Paul Kleinwachter, First Minnesota Bank ~ ______~,_~_~_____._._,___~__._._,._ ,,_. _.__.,...._~__~__.._.__._.____ .'. ..._.,___.______"__.'__n_" ,___..__._____._________________.__..,___,,~____,_._.,,_.-."-_ Monticello City Hall, 505 Walnut Street, Suite]. Monticello, MN SS362-HX31 . (763) 295-27 t 1 . Fax: (763) 2CJS-4404 Office of Public Works, 909 Golf Course Rei.. Monticello, M:'-J 55362 . (763) 295-3170. Fax: (763) 271.3272 . . . VISICOM, INC. BRUCE A. OR CYNTHIA M. HAMOND LIe. H-553~098-067-298 H-553-132-585-B43 po BOX 4B8 ';;'1'] /]/01 n MONTICEllO, MN 55362 DATE U J t7'J 0\ LV '. ~~o:%l't~ ~ ~~Q,c; I $6 Zlc;~o . ~ ~ M.. ~. Wf.>.~;;"JiDd J"~ t'. t ;?~"'. ' FIRST ~ MINNESOTA ! ,1 ~ BANK M.A. C if '" ,.. ,,". """""'. """". "''"00. ,', vi, !/I, ,1,1, ) "', I ),'l !'1", f/, (/ ! '''"0 r; ;Wl"\ \nO--Vl :~-l.L~-, tkL {U/ (/"-- I 11:09~902j531: ?B 00~2j1l' 1,03(, 75-235/91:1 7800123 4034 M'